The contract also includes an option for future studies totaling $9.8 million.

"This contract provides Raytheon with funding to continue work on this important program with our partners in Japan," said Frank Wyatt, Raytheon Missile Systems vice president of Air and Missile Defense Systems.

"The Block IIA missile will provide a greatly increased engagement capability against a wider variety of ballistic missile threats, giving the warfighter increased flexibility to protect U.S. and allied forces."

Raytheon and Mitsubishi Heavy Industries, under contract to the MDA and Japan's Ministry of Defense, are developing the next-generation SM-3 Block IIA missile, scheduled to begin flight testing in 2014.

The new missile will include larger second- and third-stage rocket motors and a larger kinetic warhead to provide a greater area of defense against sophisticated threats. Successful reviews of the motors and missile electronics were conducted jointly by both governments in July and August.

SM-3 is being developed and deployed as part of the MDA and the U.S. Navy's Aegis Ballistic Missile Defense System and is a critical component in the Phased Adaptive Approach (PAA) for protection of Europe.

The SM-3 Block IIA program is an outgrowth of the U.S. and Japanese cooperative research program. Upon completion of the flight test program, the missiles will be deployed on Aegis ships of both nations to defend against short- to intermediate-range ballistic missile threats in the ascent and midcourse phases of flight.

SM-3 Block IIA will be deployed in 2018 as part of phase three of the European PAA. It will be deployed on Aegis ships and at various land-based locations in Europe.

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